HYPERION DEFI, INC.

Note 1 – Business Organization, Nature of Operations and Basis of Presentation

Organization and Operations

Eyenovia, Inc., (“Eyenovia” or the “Company”) is an ophthalmic technology company developing a proprietary Optejet® topical ophthalmic medication dispensing platform. In November 2024, the Company received a negative clinical trial result in their development-stage drug-device combination product, MicroPine. As a result, the Company restructured, minimized expenses and engaged with an investment bank to explore strategic options in order to maximize shareholder value. The Company has paused the national sales roll-out of its products clobetasol propionate and Mydcombi® until additional funding can be obtained. At the same time, the Company accelerated development efforts relating to the Optejet.

Basis of Presentation

On January 31, 2025, the Company effected a reverse stock split of its common stock at a ratio of 1–for-80 (the “Reverse Split”). Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the Reverse Split and adjustment of the conversion price or exercise price of each outstanding equity award, convertible security and warrant as if the transaction had occurred as of the beginning of the earliest period presented (see Note 15 – Subsequent Events - Reverse Stock Split)

Note 2 – Summary of Significant Accounting Policies And Going Concern

Going Concern

As of December 31, 2024, the Company had unrestricted cash and cash equivalents of approximately $2.1 million and an accumulated deficit of approximately $195.3 million. For the years ended December 31, 2024 and 2023, the Company incurred net losses of approximately $49.8 million and $27.3 million, respectively, and used cash in operations of approximately $30.1 million and $23.8 million, respectively. The Company does not have recurring revenue and has not yet achieved profitability. The Company expects to continue to incur cash outflows from operations for the near future. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern for at least one year from the date that these financial statements are issued. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to generate sufficient recurring revenues, the Company’s ability to raise further capital, through the sale of additional equity or debt securities or the completion of a transaction consistent with the strategic alternatives that we are exploring or otherwise, to support its future operations.

The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and adequacy of its available funds will depend on many factors, including the Company’s ability to execute a strategic partnership or merger, ability to successfully commercialize its products and services, competing technological and market developments, and the need to enter into collaborations with other companies, or acquire other companies or technologies to enhance or complement its product and service offerings. If the Company is unable to generate sufficient recurring revenues or secure additional capital, it may be required to curtail its research and development initiatives, take additional measures to reduce costs in order to conserve its cash or file for bankruptcy.

Use of Estimates

Preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or U.S. GAAP, requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and the amounts disclosed in the related notes to the financial statements. The Company bases its estimates and judgments on historical experience and on various other assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities reported in the Company’s balance sheets and the amounts of expenses reported for each of the periods presented are affected by estimates and assumptions, which are used for, but not limited to, fair value calculations for equity securities, establishment of valuation allowances for deferred tax assets, revenue recognition, the recoverability and useful lives of long-lived assets, the realization of inventories and deferred clinical supply costs, the recovery of deferred costs and the deferral of revenues. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that actual results could differ from those estimates.

See Note 2 - Summary of Significant Accounting Policies — Stock-Based Compensation for additional discussion of the use of estimates in estimating the fair value of the Company’s common stock.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents in the financial statements. As of December 31, 2024 and 2023, the Company had Treasury bills with original maturity dates of three months or less in the amount of $0 and $5,450,118 respectively.

The Company has cash deposits in financial institutions that, at times, may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not experienced losses in such accounts and periodically evaluates the creditworthiness of its financial institutions. As of December 31, 2024 and 2023, the Company had cash and cash equivalent balances in excess of FDIC insurance limits of $1,658,188 and $14,243,870, respectively.

Property and Equipment, Net

Property and equipment are stated at cost, net of accumulated depreciation, amortization and impairments, which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which range from 1 to 10 years. Leasehold improvements are amortized over the lesser of (a) the useful life of the asset; or (b) the remaining lease term. Maintenance and repairs are charged to operations as incurred. The Company capitalizes costs attributable to the betterment of property and equipment when such betterment extends the useful life of the assets. Vendor deposits toward the purchase of property and equipment are reflected as equipment deposits on the accompanying balance sheets. The Company commences depreciation of assets when they are placed in service.

Impairment of Long-lived Assets

The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. An impairment would be recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. The Company recorded $11,207,897 in impairment losses during the year ended December 31, 2024, of which $9,797,198 was for the Company’s long-lived assets consisting of $6,122,945 of intangible assets, $3,254,254 of property and equipment, which includes $711,441 of equipment deposits, and $420,000 of operating lease right-of-use assets. The Company did not record any impairment losses during the year ended December 31, 2023.

Fair Value of Financial Instruments

The Company measures the fair value of financial assets and liabilities based on Accounting Standards Codification, or ASC Topic 820 “Fair Value Measurements and Disclosures”, or ASC 820, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

Level 1 — quoted prices in active markets for identical assets or liabilities;

Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable; and

Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions).

The carrying amounts of the Company’s financial instruments, such as cash and cash equivalents, restricted cash, accounts payable, and notes payable approximate fair values due to the short-term nature or effective interest rates of these instruments.

Income Taxes

The Company is subject to Federal, New York State and City, and State of California income taxes and files tax returns in those jurisdictions.

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts, or temporary differences, at enacted tax rates in effect for the years in which such temporary differences are expected to reverse.

The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.

The Company’s policy is to classify assessments, if any, for tax-related interest as interest expense and penalties as selling, general and administrative expenses in the statements of operations.

Revenue Recognition

The Company’s revenues are generated primarily through product sales or research, development and commercialization agreements. The terms of such agreements may contain multiple promised goods and services, which may include (i) licenses to its intellectual property, and (ii) in certain cases, payment in connection with the manufacturing and delivery of clinical supply materials. Payments to the Company under these arrangements typically include one or more of the following: non-refundable, upfront license fees; milestone payments; payments for clinical product supply, and royalties on future product sales.

The Company analyzes its arrangements to assess whether such arrangements involve joint operating activities. For collaboration arrangements that are deemed to be within the scope of ASC Topic 808, “Collaborative Arrangements”, or ASC 808, the Company allocates the contract consideration between such joint operating activities and elements that are reflective of a vendor-customer relationship and, therefore, within the scope of ASC Topic 606, “Revenue from Contracts with Customers”, or ASC 606. The Company’s policy is to recognize amounts allocated to joint operating activities as a reduction in research and development expense.

Under ASC 606, the Company recognizes revenue when its customers obtain control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps:

During the years ended December 31, 2024 and 2023, the Company recognized revenue primarily from the following type of contract:

Product sales – Revenue is recognized at the point in time the customer obtains control of the goods and the Company satisfies its performance obligation, which is generally at the time it ships the product to the customer.

The Company must make significant judgments in its revenue recognition process, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation. Milestone payments represent variable consideration that will be recognized when the performance obligation is achieved. Sales-based royalty payments derived from usage of intellectual property are recognized when those sales occur.

Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered discretionary purchase options. The Company assesses if these options provide a material right to the customer and if so, they are considered performance obligations.

During 2020, the Company entered into a license agreement, or the Arctic Vision License Agreement, with Arctic Vision (Hong Kong) Limited, or Arctic Vision, and a license agreement, or the Bausch License Agreement, with Bausch Health Companies, Inc., or Bausch + Lomb. Each license has three revenue components:

Arctic Vision License Agreement

On August 10, 2020, the Company entered into the Arctic Vision License Agreement pursuant to which Arctic Vision may develop and commercialize MicroPine for the treatment of progressive myopia and MicroLine for the treatment of presbyopia in Greater China (mainland China, Hong Kong, Macau and Taiwan) and South Korea. On September 14, 2021, the Company and Arctic Vision executed Amendment 1 to the Arctic Vision License Agreement pursuant to which Arctic Vision may develop and commercialize MicroStat for the treatment of mydriasis in Greater China and South Korea.

Milestone Payments

The Company may receive up to $37.7 million in milestone payments in connection with the Arctic Vision License Agreement, as amended, based on various development and regulatory milestones, including the initiation of clinical research and regulatory approvals in Greater China and South Korea, related to the filing of marketing authorization applications of approximately $13.2 million and the receipt of regulatory approvals of approximately $24.5 million. It is currently unknown when the remaining milestones related to the performance obligations will be achieved.

Royalty Payments

Arctic Vision also will purchase its supply of MicroPine, MicroLine and MicroStat from the Company or, for such products not supplied by the Company, pay the Company a mid-single digit percentage royalty on net sales of such products, subject to certain adjustments. No royalty payments were earned through December 31, 2024. The Company will pay a percentage in the range from 30% to 40% of such payments, royalties, or net proceeds of such supply to Senju pursuant to the Senju License Agreement. See Note 10—Related Party Transactions—Senju License Agreement for additional details.

Bausch License Agreements

On October 9, 2020, the Company entered into a license agreement (the Bausch License Agreement”), pursuant to which Bausch + Lomb was permitted to develop and commercialize the Bausch Licensed Product (as defined in the Bausch License Agreement) in the United States and Canada (the “Licensed Territory”). Bausch + Lomb could terminate the Bausch License Agreement, with respect to the Bausch Licensed Product to either country in the Licensed Territory, at any time for convenience upon 90 days’ written notice.

On January 12, 2024, the Company and Bausch + Lomb entered into a mutual termination and reassignment agreement (the “Letter Agreement”), pursuant to which Eyenovia reacquired the rights to the Bausch Licensed Product. The terms of the agreement include the immediate transfer of the rights and the subsequent transfer of certain assets relating to the Bausch Licensed Product from Bausch + Lomb to the Company in exchange for cash and common stock consideration. In addition, under the terms of the Letter Agreement, the Company agreed to pay Bausch + Lomb a low single-digit royalty on its net sales of the Bausch Licensed Product in the United States and Canada for a period of ten years from the date of the first commercial sale by the Company (or its affiliates or licensees) of the Bausch Licensed Product in the United States. Under the Letter Agreement, (i) the Company will re-acquire any and all licenses and other rights granted by the Company to Bausch + Lomb under the original Bausch License Agreement, (ii) any and all licenses and other rights granted by Bausch + Lomb to the Company under the License Agreement are terminated, other than as set forth in the Letter Agreement, and (iii) other than as set forth in the Letter Agreement, Bausch + Lomb is released from all of their ongoing obligations under the License Agreement, including development and commercialization obligations.

Pursuant to the Letter Agreement, the Company paid Bausch + Lomb an upfront payment of $2.0 million in cash on January 22, 2024. The Company recorded this amount as an operating expense. In connection with the entry into the Letter Agreement, the Company also agreed to issue Bausch + Lomb $3.0 million in shares of the Company’s common stock, following the Regulatory Transfer Date (the “Transfer Date”). On April 11, 2024, the Transfer Date, the transfer of the rights and certain assets relating to the CHAPERONE trial from Bausch + Lomb to the Company, was completed. On May 3, 2024, the Company issued Bausch + Lomb 28,742 shares of the Company’s common stock (calculated pursuant to the Letter Agreement at $3.0 million using a thirty-day volume-weighted average price on April 11, 2024, but valued at $2.3 million on the May 3, 2024 settlement date, resulting in a $0.7 million change in fair value of the equity consideration payable), in satisfaction of its obligations pursuant to the Letter Agreement.

Pursuant to the Side Letter (see Note 10 – Commitments and Contingencies - Defective Clinical Supply), the Company agreed to pay approximately $0.5 million to Bausch + Lomb related to the defective clinical supply. It was also agreed that the Company will receive approximately $0.25 million from Bausch + Lomb to fund the vendor hold back liability that will be due upon completion of the CHAPERONE study. In addition, the Company purchased $0.5 million of clinical supplies from Bausch + Lomb in April 2024.

Clinical Supply Arrangements

Bausch + Lomb and Arctic Vision had contracted with the Company to manufacture and supply them with the appropriate drug-device combination products to conduct their clinical trials on a cost plus 10% mark-up basis. Based on the Letter Agreement with Bausch + Lomb referenced above, the arrangement with Bausch + Lomb is terminated. The arrangement with Arctic Vision is still in place. The Company’s licensing agreement with Arctic Vision represent collaborative arrangements and they are not a customer with respect to the clinical supply arrangements. The Company’s policy is to (a) defer the materials and manufacturing costs in order to properly match them up against the income from the clinical supply arrangements; and (b) report the net income from the clinical supply arrangements as other income. Deferred clinical supply costs were $0.0 million and $4.3 million at December 31, 2024 and 2023, respectively. Net income from the sale of clinical supplies was included in other income and amounted to $0.0 million and $0.2 million for the years ended December 31, 2024 and 2023, but a $0.4 million provision for possible product returns was also charged against the results for the year ended December 31, 2023. This provision was for the cost to replace or rework the defective clinical supply product. See Note 10 – Commitments and Contingencies – Defective Clinical Supply.

Inventories

Inventories are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. The cost of inventory that is sold to third parties is included within cost of sales. The Company will periodically review for slow-moving, excess or obsolete inventories.

Inventory is primarily comprised of drug-device combination products, which are available for commercial sale, as follows:

During the year ended December 31, 2024, the Company recorded a charge of approximately $3.1 million of inventories to cost of revenue in order to write down inventories to their net realizable value.

Intangible Assets

Intangible assets are stated at fair value as of the date acquired, less accumulated amortization. Amortization is calculated based on the estimated useful lives of the assets, using the straight-line method or another method that more fairly represents the utilization of the assets.

The Company periodically evaluates the remaining useful lives of our intangible assets to determine whether events or circumstances warrant a revision to the remaining periods of amortization. In the event that the estimate of an intangible asset’s remaining useful life

has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. If it is determined that an intangible asset has an indefinite useful life, that intangible asset would be subject to impairment testing annually or whenever events or circumstances indicate that its carrying value may not, based on future undiscounted cash flows or market factors, be recoverable.

Operating Leases

The Company leases its facilities under non-cancellable operating leases. The Company evaluates the nature of each lease at the inception of an arrangement to determine whether it is an operating or financing lease and recognizes the right-of-use asset and lease liabilities based on the present value of future minimum lease payments over the expected lease term. The Company recognizes a liability to make lease payments, the “lease liability”, and an asset representing the right to use the underlying asset during the lease term, the “right-of-use asset”. The lease liability is measured at the present value of the remaining lease payments, discounted at the Company’s incremental borrowing rate. The Company’s leases do not generally contain an implicit interest rate and therefore the Company uses the incremental borrowing rate it would expect to pay to borrow on a similar collateralized basis over a similar term in order to determine the present value of its lease payments. The right-of-use asset is measured at the amount of the lease liability adjusted for the remaining balance of any lease incentives received, any cumulative prepaid or accrued rent if the lease payments are uneven throughout the lease term, any unamortized initial direct costs, and any impairment of the right-of-use-asset. Operating lease expense consists of a single lease cost calculated so that the remaining cost of the lease is allocated over the remaining lease term on a straight-line basis, variable lease payments not included in the lease liability, and any impairment of the right-of-use asset.

Research and Development

Research and development expenses are charged to operations as incurred. The Company records prepaid expenses on its balance sheet for the payment of research and development expenses in advance of services being provided.

The Company’s license agreements were determined to represent collaborative arrangements. Pursuant to these collaborative arrangements, the licensee is required to reimburse the Company for certain research and development expenses. Providing research and development activities in the context of a collaboration agreement is not an ordinary activity for the Company. Accordingly, the licensee is not a customer with respect to the reimbursements and such payments are not subject to ASC 606 – Revenue Recognition. The Company’s policy is to recognize the reimbursements as contra – research and development expense. The receivable for such payments, plus other license payments, is included in “license fee and expense reimbursements receivable” on the accompanying balance sheets.

Stock-Based Compensation

The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date and the fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Upon the exercise of an option, the Company issues new shares of common stock out of the shares reserved for issuance under its equity plans. See Note 12 – Stockholders’ Equity – Stock Options for additional information related to estimating the fair value of stock options.

Net Loss Per Share of Common Stock

Basic net loss per share of common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period, plus fully vested shares that are subject to issuance for little or no monetary consideration. Diluted loss per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock. The following table presents the computation of basic and diluted net loss per common share:

The following securities are excluded from the calculation of weighted average dilutive shares of common stock because their inclusion would have been anti-dilutive:

Subsequent Events

The Company has evaluated subsequent events through the date which the financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the financial statements, except as disclosed.

Recently Issued Accounting Standards

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. This update also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of this standard but does not expect it to have a material impact on its financial statements.

In November 2024, The FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220 – 04). This update requires an entity to disclose more detailed information regarding expenses for the entity. The amendments require that at each interim and the annual reporting period, the entity must disclose amounts related to purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion, and amortization recognized as part of oil and gas- producing activities. Including the amounts, the entity is required to disclose and qualitative description of the amounts remaining in relevant expense captions, and to disclose the total amount of selling expenses and the definition of selling

expenses. The amendments in this update should be applied prospectively to financial statements issued for reporting periods, and retrospectively to any prior periods presented in the financials. Although early adoption is permitted, the new guidance becomes effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Since this new ASU addresses only disclosures, the Company does not expect the adoption of this ASU to have any material effects on its financial condition, results of operations or cash flows.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” These amendments require a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Public entities with a single reporting segment are required to provide both the new disclosures and all of the existing disclosures required under ASC 280. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted this ASU for the year ended December 31, 2024. Since this new ASU addresses only disclosures, the adoption of this ASU did not have a material effect on the Company’s financial condition, results of operations or cash flows.

Note 3 – Prepaid Expenses and Other Current Assets

As of December 31, 2024 and 2023, prepaid expenses and other current assets consisted of the following:

As of December 31, 2024, the Company wrote off $710,820 of prepaid regulatory expenses, due to the uncertainty associated with the Company’s clobetasol propionate and Mydcombi products and its exploration of strategic alternatives.

Note 4 - Property and Equipment, Net

As of December 31, 2024 and 2023, property and equipment consisted of the following:

Depreciation expense was $1,128,449 and $783,208 for the years ended December 31, 2024 and 2023, respectively, of which $1,112,464 and $776,479, respectively, was included within research and development expenses and $15,985 and $6,729, respectively, was included in selling, general and administrative expenses in the accompanying statements of operations.

As of December 31, 2023, the Company had $711,441 of outstanding deposits for equipment purchases, which are presented as non-current assets on the balance sheet. As of December 31, 2024, the Company impaired the $711,441 outstanding deposits due to the uncertainty associated with idling its manufacturing operations for Mydcombi.

Additionally, the Company impaired $3,254,254 of its remaining fixed assets due to the uncertainty associated with its operations and its exploration of strategic alternatives.

Note 5 – Intangible Assets

On August 15, 2023, the Company entered into a license agreement (the “Formosa License”) with Formosa Pharmaceuticals Inc. (“Formosa”), whereby the Company acquired the exclusive U.S. rights to commercialize any product related to a novel formulation of clobetasol propionate ophthalmic suspension,0.05% (the “Formosa Licensed Product”), which was approved by the FDA for ophthalmic use for inflammation and pain after ocular surgery and supplemental disease indications, if any, associated with the New Drug Application for the Formosa Licensed Product. The Formosa License will remain in effect for ten years from the date of the first commercial sale of a Formosa Licensed Product, unless earlier terminated. The Company paid Formosa the aggregate amount of$2.0 million (the “Upfront Payment”), consisting of (a) cash in the amount of$1.0 million and (b)6,097 shares of common stock, which is included in Intangible Assets on the accompanying balance sheet. The Company also capitalized$122,945 of transaction costs, which were primarily legal expenses. In addition to the Upfront Payment, the Company must pay Formosa up to$4.0 million upon the achievement of certain development milestones and up to$80.0 million upon the achievement of certain sales milestones. The trigger for the initial$2.0 million development milestone payments was FDA approval of the Formosa Licensed Product and the effective date of the acceptance by the Company of the transfer and assignment of the FDA approval. This occurred on March 14, 2024. Under the provisions of the Formosa License, the Company had 45 days from the effective date of acceptance of the transfer and assignment of FDA approval to make the payment half in cash and half in common stock, otherwise the payment due would revert to be fully in cash. The Company paid Formosa the aggregate amount of$2.0 million, consisting of (a) cash in the amount of$1.0 million on April 26, 2024 and (b)7,668 shares of common stock on April 29, 2024 (calculated pursuant to the Formosa License using a five-day volume-weighted average price on March 14, 2024, but valued at$0.4 million on the April 29, 2024 settlement date, resulting in a$0.6 million change in fair value of the equity consideration payable), which was included in our impairment of Intangible Assets at December 31, 2024. The second$2.0 million development milestone (to be fully paid in cash) was earned upon FDA approval of the Formosa Licensed Product and payment was triggered on the earlier of twelve months after FDA approval or six months following the first commercial sale of the Formosa Licensed Product. As of the Form 10-K filing date, this payment remains unpaid and under negotiation. Because the payment became probable and estimable, the Company recorded an additional$2.0 million increase in the intangible asset which was included in accrued expenses at December 31, 2024.

It was determined that the transaction represented an asset acquisition, rather than a business combination, because substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset. Consequently, the accounting is pursuant to the cost accumulation model. The Upfront Payment has been capitalized as an intangible asset by the Company.

In October 2024, the Company had its first commercial sale of the Licensed Product, however, due to the uncertainty associated with its clobetasol propionate product, the Company impaired the full$6,122,945 carrying value of the Formosa License at December 31, 2024.

Note 6 – Accrued Compensation

As of December 31, 2024 and 2023, accrued compensation consisted of the following:

Note 7 – Accrued Expenses and Other Current Liabilities

As of December 31, 2024 and 2023, accrued expenses and other current liabilities consisted of the following:

Note 8 – Notes Payable and Convertible Notes Payable

As of December 31, 2024 and 2023, notes payable and convertible notes payable consisted of the following:

BankDirect Capital Finance Loan

On February 24, 2023, the Company issued a note payable in the amount of $609,140 for the purchase of a directors and officers’ liability insurance policy (the “2023 D&O Loan”). The note accrued interest at a rate of 7.11% per year and matured on August 24, 2023. The 2023 D&O Loan was payable insix monthly payments of $103,639 consisting of principal and interest. The note payable was repaid in full during the year ended December 31, 2023. Interest expense was $12,694 for the year ended December 31, 2023.

On February 24, 2024, the Company issued a note payable in the amount of $505,050 for the purchase of a directors and officers’ liability insurance policy (the “2024 D&O Loan”). The note accrued interest at a rate of 8.15% per year and matured on October 24, 2024. The 2024 D&O Loan was payable ineight monthly payments of $65,076 consisting of principal and interest. The note payable was repaid in full during the year ended December 31, 2024. Interest expense was $15,558 for the year ended December 31, 2024.

Avenue Ventures Loan

On November 22, 2022, the Company entered into a Loan and Security Agreement (the “Avenue Loan Agreement”) with Avenue Venture Opportunities Fund, L.P., (“Avenue 1”), and Avenue Venture Opportunities Fund, L.P. II, (“Avenue 2”), and together with Avenue, (the “Lender”), for an aggregate principal amount of up to $15,000,000 (the “Avenue Loan”). The initial tranche of the Avenue Loan was $10,000,000, consisting of $4,000,000 from Avenue and $6,000,000 from Avenue 2. Up to $5,000,000 of the principal amount outstanding may be converted at the option of the Lender into shares of the Company’s common stock at a conversion price of $171.84

per share, subject to typical anti-dilution adjustments. The Avenue Loan bears interest at an annual rate equal to the greater of (a)7.0% and (b) the prime rate as reported in The Wall Street Journal plus 4.45%. The Avenue Loan maturity date is November 1, 2025. The Company was able to request an additional $5,000,000 of gross funding between April 1, 2023 and July 31, 2023, subject to agreed-upon conditions. The Company must also make an incremental final payment equal to 4.25% of the aggregate funding, amounting to a premium of $425,000 on the initial tranche. The Company will make monthly interest-only payments during the first twelve months of the Avenue Loan, which could be increased to up toeighteen months upon the achievement of specified performance milestones. Following the interest-only period, the Company will make equal monthly payments of principal and interest until the maturity date, plus interest. If the Company prepays the Avenue Loan, it will be required to pay a prepayment fee of 3% if the Avenue Loan is prepaid during the first year,2% if the Avenue Loan is prepaid during the second year and 1% if the Avenue Loan is repaid during the third year.

On May 22, 2023, pursuant to the Loan and Security Agreement, the Company received an additional tranche of non-convertible debt funding in the amount of $5,000,000. The Company paid approximately $126,000 of origination and legal fees connected to this debt funding. The additional funding is subject to the same interest and maturity date as the initial tranche. The additional funding triggered the extension of the interest-only payment period from the original 12 months to 18 months (through May 2024) for the entire outstanding balance due under the Avenue Loan Agreement (initial and additional tranches). Following the interest-only period, the Company will make equal monthly payments of principal until the maturity date, plus interest. The Company must also make a final payment equal to 4.25% of the additional tranche, amounting to a premium of $212,500 on the additional tranche. The total final payment on the aggregate borrowing is $637,500. If the Company prepays the Avenue Loan, it will be required to pay a prepayment fee of 2% if the Avenue Loan is prepaid during the second year and 1% if the Avenue Loan is repaid during the third year.

In June 2024, the Company began making principal payments related to that certain loan and security agreement (the “Loan and Security Agreement”) with Avenue Capital Management II, L.P. and related entities (together, “Avenue”) in the amount of $833,333 per month plus interest.

On November 22, 2024, the Company entered into an amendment of the Avenue Loan (the “First Amendment”), whereby the Lender agreed to defer principal and interest payments on the amounts outstanding until March 2025. In connection with the First Amendment, the Company granted an aggregate of 23,771 shares of its common stock to the Lender. The price per share was based on the Company’sfive trading-day volume-weighted average price (VWAP) preceding the date of the First Amendment of approximately $8.42 per share. The shares have a gross value of approximately $200,000. This is accounted for as a component of debt discount.

The Avenue Loan requires the Company to make and maintain representations and warranties and other agreements that are customary in loan agreements of this type. The Avenue Loan is secured by all of the Company’s assets, including intellectual property. The Avenue Loan also contains customary events of default, including non-payment of principal or interest, violations of covenants, bankruptcy and material judgments. Upon the occurrence of an event of default, all interest and principal immediately become due and payable. In addition, Avenue will have the right to exercise any other right or remedy provided by applicable law.

The following is a summary of the Avenue loan at December 31, 2024:

During the years ended December 31, 2024 and 2023, the Company recorded interest expense relating to the Avenue Loan of $2,468,863 (which includes $759,049 of amortization of debt discount) and $2,359,157 (which includes $681,860 of amortization of debt discount), respectively.

See Note 15 – Subsequent Events - Avenue Ventures Loan Second Amendment.

Note 9 – Income Taxes

The provision for income taxes consists of the following (expenses) benefits:

The provision for income taxes differs from the United States Federal statutory rate as follows:

Deferred tax assets consist of the following:

As of December 31, 2024, the Company had approximately $133,700,000 of domestic federal net operating loss carryforwards, or NOLs, that may be available to offset future federal taxable income. Approximately $10,800,000 of those NOLs will expire during the years ranging from 2034 to 2037. The remaining NOLs of approximately $122,900,000 have no expiration dates. Internal Revenue Code Section 382 limits the utilization of approximately $35,000,000 of those NOLs to approximately $918,000 on an annual basis as a result of ownership changes that occurred through July 15, 2019. As of December 31, 2024, the Company had approximately $66,400,000 of state NOLs, of which approximately $66,200,000 will expire during the years ranging from 2040 to 2044, and approximately $200,000 will not expire, and had approximately $52,200,000 of local NOLs which do not expire.

The Company has assessed the likelihood that deferred tax assets will be realized in accordance with the provisions of ASC 740 “Income Taxes Accounting”, or ASC 740. ASC 740 requires that a valuation allowance be established when it is “more likely than not” that all, or a portion of, deferred tax assets will not be realized. The assessment considers all available positive or negative evidence, including the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies. After the performance of such reviews as of December 31, 2024 and 2023, management believes that uncertainty exists with respect to future realization of its deferred tax assets and has, therefore, established a full valuation allowance as of those dates.

Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s financial statements as of December 31, 2024 and 2023. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date.

No tax audits were commenced or were in process during the years ended December 31, 2024 and 2023. No tax related interest or penalties were incurred during the years ended December 31, 2024 and 2023. The Company’s federal, state and local income tax returns beginning with the year ended December 31, 2021 remain subject to examination.

Note 10 – Commitments and Contingencies

Employment Agreements

As of December 31, 2024, the aggregate potential severance pay for the executive officers of the Company is approximately$1,029,000.

Defective Clinical Supply

During the third quarter of 2023, a certain portion of clinical supply product sold by the Company to Bausch + Lomb was determined to be defective. On April 23, 2024, the Company and Bausch + Lomb executed a letter agreement (the “Side Letter”) pursuant to which the Company and Bausch + Lomb agreed that the Company would pay approximately$0.4 million to Bausch + Lomb related to the defective clinical supply which charge was included within other income (expense) during the year ended December 31, 2023, because the original sales to the licensee were recorded on that line item. See Note 2 – Summary of Significant Accounting Policies - Bausch License Agreements.

Operating Leases

In April 2022, the Company entered into a new lease agreement for 3,916 square feet in Laguna Hills, California. The new lease term isfive years and two months, commencing on June 1, 2022 and expiring on July 31, 2027. The monthly base rent ranges from $9,203 to $10,358 per month over the term of the lease. The security deposit is $11,400. The Company’s rent expense for all Laguna Hills space is recorded in selling, general and administrative expense and amounted to $117,890 and $118,746 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $116,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

In May 2022, the Company entered into a lease agreement to lease 10,880 square feet of office space in Reno, Nevada. The lease term isfive years and four months, commencing on May 23, 2022 and expiring on September 23, 2027. The monthly base rent ranges from $13,056 to $16,663 per month over the term of the lease. The security deposit is $53,000. The Company’s rent expense for this space is recorded in research and development expense and amounted to $169,303 and $164,950 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $80,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

In February 2023, the Company exercised its options to renew its three leases in Redwood City, California, for a total of approximately 6,700 square feet. The leases were due to expire on August 31, 2023. The leases were extended from September 1, 2023 to August 31, 2025. The aggregate monthly base rent ranges from $15,742 to $16,700 per month over the term of the lease. The security deposit is $14,968. The Company’s rent expense for this space is recorded in research and development expense and amounted to $193,591 and $192,710 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $125,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

In June 2023, the Company entered into an extension agreement to renew its lease for approximately 3,800 square feet of office space in New York, NY. The lease was due to expire on September 30, 2023. The lease was extended from November 1, 2023 to December 31, 2026. The monthly base rent ranges from $19,633 to $21,298 per month over the term of the lease. The security deposit is $117,800. The Company’s rent expense for this space is recorded in selling, general and administrative expense and amounted to $220,394 and $233,534 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, the Company recorded an impairment of the right-of-use asset of $99,000 associated with this lease in the Company’s financial statements due to the uncertainty associated with its operations and its exploration of strategic alternatives.

A summary of the Company’s right-of-use assets and liabilities is as follows:

Future minimum payments under the Company’s operating lease agreements are as follows:

Litigations, Claims and Assessments

In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements.

Senju License Agreement

See Note 11 – Related Party Transactions - Senju License Agreement for a related party agreement entered into with Senju.

Note 11 – Related Party Transactions

Senju License Agreement

During 2015, the Company entered into an exclusive license agreement with Senju, or the Senju License Agreement, whereby the Company agreed to grant to Senju an exclusive, royalty-bearing license for its microdose product candidates for Asia to sublicense, develop, make, have made, manufacture, use, import, market, sell, and otherwise distribute the microdose product candidates. In consideration for the license, Senju agreed to pay to Eyenovia five percent (5%) royalties on sales (net of certain manufacturing costs) for the term of the Senju License Agreement, subject to certain adjustments upon the loss of patent coverage for the term of the license agreement. The agreement will continue in full force and effect, on a country-by-country basis, until the latest to occur of: (i) the tenth (10th) anniversary of the first commercial sale of such a product candidate in a country; or (ii) the expiration of the licensed patents in a country. As of the date of this filing, there have been no commercial sales of such a product in Asia; therefore, no royalties have been earned. Senju is owned by the family of a former member of the Company’s Board of Directors.

On April 8, 2020, Eyenovia entered into an amendment, (the “Senju License Amendment”), to the Senju License Agreement. Pursuant to the Senju License Amendment, the Company can license to any third party the right to research, develop, commercialize, manufacture or use certain products, or the Senju Licensed Products previously licensed to Senju in China (including the People’s Republic of China, Hong Kong, Macao, and Taiwan) and South Korea, or the Territory.

Pursuant to the Senju License Amendment, the Company must pay Senju (a) a percentage in the range of 30% to 40% of revenue on (i) any lump-sum payments the Company receives from the third party, (ii) revenue (net of costs) obtained by the Company from contract research and/or development of the Senju Licensed Product in the Territory, and (iii) revenue (net of costs) obtained by the Company from contract manufacture for the device of the Senju Licensed Product in the Territory, the aggregate of which must be at least a $9 million minimum payment to Senju; and (b) a percentage in the range of 30% to 40% of any sales royalty revenue the Company receives from the third party. Since the Company executed a third-party license prior to the April 8, 2021 expiration of the Senju License, the Senju License Amendment will remain in effect for the duration of the license, subject to early termination.

The Senju License Agreement was further amended in a Letter Agreement by and between the Company and Senju on August 10, 2020, or the Letter Agreement. Pursuant to the Letter Agreement, the Company will pay to Senju a percentage in the range of 30% to 40% of certain payments, royalties, or net proceeds received from Arctic Vision in connection with the Arctic Vision License Agreement. The Senju License Agreement was amended further by the License Amendment 2, effective September 14, 2021, (“Amendment 2”). The Amendment 2 excludes Greater China and South Korea from the territory in which Senju was granted an exclusive royalty-bearing license from the Company. In consideration for this exclusion, and upon and after the execution of Amendment 1 with Arctic Vision, the Company must make payments to Senju based on non-royalty license revenue and sales revenue, including the following:

Advisory Agreement

In August 2022, the Company entered into an agreement with Dr. Ianchulev, or the Executive Chairman Agreement, pursuant to which Dr. Ianchulev agreed to provide medical expertise and consultation related to the Company’s research and development programs, and such other matters as reasonably requested by the Company for an initial period ofone year. The terms allowed for the agreement to be extended by mutual agreement of the parties. In consideration for Dr. Ianchulev’s services, the Company agreed to provide Dr. Ianchulev with a $5,000 monthly retainer throughout the term of the agreement, in addition to the compensation payable to all non-employee members of the Board. As of December 31, 2024, the agreement was still in effect.

Note 12 – Stockholders’ (Deficiency) Equity

Authorized Capital

The Company is authorized to issue 300,000,000 shares of common stock, par value of $0.0001 per share, and 6,000,000 shares of preferred stock, par value of $0.0001 per share. The holders of the Company’s common stock are entitled toone vote per share. The Board of Directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, redemption, voting or other rights. On June 12, 2024, at the Annual Shareholders’ Meeting, the Company proposed and the shareholders approved an increase in the authorized number of shares of the Company’s common stock from 90,000,000 to 300,000,000 at the same par value of $0.0001 per share.

Equity Incentive Plans

On April 7, 2020, the Company’s Board of Directors approved the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan (the “Restated Plan”), which stockholders approved on June 30, 2020. Under the Restated Plan, as amended on June 16, 2022 and June 27, 2023,83,750 shares of the Company’s common stock are reserved for issuance. The Restated Plan requires that all equity awards issued under the Restated Plan vest at least twelve months from the applicable grant date, subject to accelerated vesting, and provides that no dividend or dividend equivalent will be paid on any unvested equity award, although dividends with respect to unvested portions of equity may accrue and be paid when, and if, the awards later vest and the shares are actually issued to the grantee. In addition, the Restated Plan sets an annual limit on the grant date fair value of awards to any non-employee director, together with any cash fees paid during the year, of $150,000, subject to certain exceptions for a non-executive chair of the Board. As of December 31, 2024, the number of securities remaining available for future issuance under equity compensation plans was 14,227. On January 21, 2025, the stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan to reserve an additional 350,000 shares of the Company’s common stock for issuance (see Note 15 – Subsequent Events, Increase of 2018 Omnibus Stock Incentive Plan Shares).

Common Stock Issuances

Pursuant to the License and certain milestone achievements, the Company issued 7,668 shares of common stock valued at $0.4 million on April 29, 2024 to Formosa (see Note 5 – Intangible Assets).

On May 3, 2024, the Company issued Bausch + Lomb 28,742 shares of the Company’s common stock, valued at $2.3 million, in satisfaction of its obligations pursuant to the Letter Agreement (see Note 2 – Summary of Significant Accounting Policies - Bausch License Agreements).

At-The-Market Program

December 2021 Sales Agreement

On December 14, 2021, the Company entered into a Sales Agreement, (the “December 2021 Sales Agreement”), with SVB Securities under which the Company may offer and sell, from time to time at its sole discretion, shares of common stock for gross proceeds of up to $50.0 million through SVB Securities as its sales agent, or the 2021 Offering. The issuance and sale of shares, if any, of common stock by the Company under the December 2021 Sales Agreement will be pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-261638) filed with the SEC on December 14, 2021, or the Registration Statement, and the prospectus relating to the 2021 Offering filed therewith that forms a part of the Registration Statement.

Subject to the terms and conditions of the December 2021 Sales Agreement, SVB Securities may sell the common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act of 1933, as amended. SVB Securities will use commercially reasonable efforts to sell the common stock from time to time, based upon instructions from the Company (including any price, time or size limits or other customary parameters or conditions the Company may impose). The Company will pay SVB Securities a commission equal to three percent (3.0)% of the gross sales proceeds of any common stock sold through SVB Securities under the December 2021 Sales Agreement, and also has provided SVB Securities with certain indemnification rights.

During the year ended December 31, 2023, the Company received approximately $4.7 million in gross proceeds and $4.6 million in net proceeds from the sale of 23,327 shares of its common stock under the December 2021 Sales Agreement with Leerink Partners, LLC, formerly known as SVB Securities (“Leerink Partners”).

During the year ended December 31, 2024, the Company received approximately $6.2 million in gross proceeds and $6.0 million in net proceeds from the sale of 70,382 shares of its common stock under the December 2021 Sales Agreement with Leerink Partners.

On December 30, 2024, the Company entered into an Amended and Restated Sales Agreement (the “A&R Sales Agreement”) with Chardan Capital Markets, LLC (“Chardan”) with respect to the Company’s existing at-the-market offering program. The A&R Sales Agreement amends and restates the December 2021 Sales Agreement by and between the Company and Leerink Partners to, among other things, replace Leerink Partners with Chardan as sales agent. The Company will pay Chardan a commission equal tothree percent (3.0)% of the gross sales proceeds of any common stock sold through Chardan under the December 2021 Sales Agreement, and also has provided Chardan with certain indemnification rights.

At December 31, 2024, no shares had settled under the A&R Sales Agreement with Chardan.

Offerings

August 2023 Offering and Warrant Modification

On August 24, 2023, the Company entered into a securities purchase agreement with a certain institutional and accredited investor (the “Purchaser”), pursuant to which the Company agreed to sell, in a registered direct offering by the Company directly to the Purchaser (the “August 2023 Offering”),52,483 shares of common stock, pre-funded warrants to purchase up to 28,162 shares of common stock and warrants to purchase up to 60,484 shares of common stock (the “Common Warrants” and, together with the Pre-Funded Warrants, the “Warrants”). The combined offering price for each share of common stock and accompanying Common Warrant was $148.80, and the combined offering price for each Pre-Funded Warrant and accompanying Common Warrant was $148.00.

The Common Warrants will be exercisable beginning six months following the date of issuance and may be exercised for a period offive years from the initial exercisability date at an exercise price of $178.40 per share. The Pre-Funded Warrants were immediately exercisable and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full at an exercise price of $0.80 per share. The exercise prices and numbers of shares of common stock issuable upon exercise of the Common Warrants and the Pre-Funded Warrants are subject to typical anti-dilution provisions. A holder may not exercise any portion of such holder’s Common Warrants or Pre-Funded Warrants to the extent that the holder would own more than 4.99% of the Company’s outstanding common stock immediately after exercise (unless the holder otherwise elects a limitation of 9.99%). The Company determined that the Warrants met the criteria to be classified as equity.

The net cash proceeds of the August 2023 Offering were approximately $10.9 million after deducting cash issuance costs in the aggregate amount of approximately $1.1 million. The August 2023 Offering closed on August 29, 2023.

In connection with the August 2023 Offering, the Company entered into a warrant amendment agreement (the “Amendment”) with the Purchaser, whereby the Company agreed to amend the March 2022 Investor Warrants to (i) reduce the exercise price from $283.20 per share of common stock to $178.40 per share of common stock, (ii) extend the term of the March 2022 Investor Warrants until March 1, 2029, (iii) include a stockholder approval requirement in connection with a modification of the beneficial ownership limitation and (iv) prohibit exercise of the March 2022 Investor Warrants for the six-month period following the effective date of the Amendment.

The Company accounted for the modification of the March 2022 Investor Warrants as an exchange of the old warrants for new warrants. The incremental value of the new warrant (resulting from the decrease in exercise price from $283.20 to $178.40 per share and the extension of the warrant expiration date to March 1, 2029) was measured as the excess of the fair value of the modified warrants over the fair value of the original warrants immediately before modification. The increase in the incremental value of $1,738,700 was credited to additional paid-in-capital (“APIC”) and debited to APIC as an issuance cost of the August 2023 Offering.

2024 Offerings and Warrant Modification

A summary of the 2024 offerings is presented below:

April Offering

On April 8, 2024, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with a single fundamentals-based healthcare investor (the “Purchaser”), pursuant to which the Company agreed to sell, in a registered direct offering by the Company directly to the Purchaser (the “April 2024 Offering”),40,297 shares of common stock. The price per share in the April 2024 Offering was $49.63. The aggregate gross proceeds to the Company from the 2024 April Offering were $2.0 million, and net proceeds after offering costs were approximately $1.9 million.

July Offering and Warrant Amendment

On July 1, 2024, the Company closed on a registered direct offering (the “July 2024 Offering”) with certain institutional and accredited investors (the “July 2024 Investors”), pursuant to which the Company sold 94,697 shares of common stock and warrants to purchase up to 94,697 shares of common stock. The combined offering price for each share of common stock and accompanying warrant was$52.80. The Company also agreed to issue warrants to purchase an additional 21,872 shares of common stock (the “Additional Warrants”) to one of the July 2024 Investors. All of the new warrants become exercisablesix months following their issuance, at an exercise price of$55.20 per share, and may be exercised until January 2, 2030.

In connection with the July 2024 Offering, the Company entered into warrant amendment agreements (the “Amendments”) with the holders of previously issued warrants (the “Prior Warrants”) to purchase up to an aggregate of 129,828 shares of common stock, whereby the Company agreed to amend the Prior Warrants to reduce the exercise price of the Prior Warrants from $178.40 and $197.60 per share of common stock to $55.20 per share of common stock, extend the term of the Prior Warrants until January 2, 2030 and prohibit exercise of the Prior Warrants for the six-month period following the effective date of the Amendments.

The aggregate gross proceeds to the Company from the July 2024 Offering were approximately $5.0 million, and net proceeds after cash offering costs were approximately $4.3 million. Offering costs include placement agent fees of $0.4 million and Company legal fees of $0.3 million. In addition, there were $2.9 million of non-cash issuance costs which represents the value of the Additional Warrants, plus the modification date incremental value of the modified Prior Warrants as compared to the original Prior Warrants, as an issuance cost of the warrant exercise.

August* *Offering

On August 21, 2024, the Company agreed to sell 160,624 shares of common stock to certain institutional and accredited investors (the “August Investors”), in some cases pursuant to a securities purchase agreement (the “August 2024 Offering”). The price per share in the August 2024 Offering was $32.00. The aggregate gross proceeds to the Company from the August 2024 Offering were approximately $5.1 million, and net proceeds after offering costs were approximately $4.5 million.

September Offering and Warrant Amendment

On September 30, 2024, the Company closed on a registered direct offering (the “September 2024 Offering”) with a certain purchaser, pursuant to which the Company sold to the purchaser 107,875 shares of common stock; pre-funded warrants to purchase up to 821

shares of common stock; and warrants to purchase up to 108,696 shares of common stock at an exercise price of $40.00 per share. The combined offering price for each share and accompanying warrant was $36.80. The combined offering price for each pre-funded warrant and accompanying Warrant was $36.79, which is equal to the purchase price per share in the September 2024 Offering, minus $0.008, the exercise price per share of the pre-funded warrants. The warrants will be exercisable beginning six months following the date of issuance and may be exercised until March 31, 2030. The aggregate gross proceeds to the Company from the September 2024 Offering were approximately $4.0 million, and net proceeds after offering costs were approximately $3.6 million. On October 1, 2024, the holder of the 821 pre-funded warrants issued in the September Offering, exercised the pre-funded warrants at a price of $0.008 per share of common stock.

In connection with the December Offering, the Company entered into an amendment of the September Offering warrants to require stockholder approval to be exercisable and the termination date to befive years after stockholder approval.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the September Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

November Offering and Warrant Amendment

On November 24, 2024, the Company closed on a registered direct offering (the “November 2024 Offering”) with an institutional investor, pursuant to which the Company sold to the purchaser 112,500 shares of common stock; pre-funded warrants to purchase up to 38,522 shares of common stock; and warrants to purchase up to 302,045 shares of common stock at an exercise price of $8.608 per share. The combined offering price for each share and accompanying warrant was $8.608 The combined offering price for each pre-funded warrant and accompanying Warrant was $8.60, which is equal to the purchase price per share in the November 2024 Offering, minus $0.008, the exercise price per share of the pre-funded warrants. The warrants will be exercisable beginning six months following the date of issuance and may be exercised until November 24, 2029. The aggregate gross proceeds to the Company from the November 2024 Offering were approximately $1.3 million, and net proceeds after offering costs were approximately $1.1 million. On November 25, 2024, the holder of the 38,522 pre-funded warrants issued in the November Offering, exercised the pre-funded warrants at a price of $0.008 per share of common stock.

In connection with the December Offering, the Company entered into an amendment of the November Offering warrants to require stockholder approval to be exercisable and the termination date to befive years after stockholder approval.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the November Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

December Offering

On December 5, 2024, the Company closed on a registered direct offering (the “December 2024 Offering”) with an institutional investor, pursuant to which the Company sold to the purchaser 137,500 shares of common stock; pre-funded warrants to purchase up to 113,563 shares of common stock; and warrants to purchase up to 502,126 shares of common stock at an exercise price of$7.752 per share. The combined offering price for each share and accompanying warrant was$7.752. The combined offering price for each pre-funded warrant and accompanying Warrant was$7.744, which is equal to the purchase price per share in the December 2024 Offering, minus$0.008, the exercise price per share of the pre-funded warrants. The warrants required stockholder approval to be exercisable and the termination date to befive years after stockholder approval. The aggregate gross proceeds to the Company from the December 2024 Offering were approximately$1.9 million, and net proceeds after offering costs were approximately$1.7 million. On December 11, 2024, the holder of the 113,563 pre-funded warrants issued in the December Offering, exercised the pre-funded warrants at a price of$0.008 per share of common stock.

Subsequently, on January 21, 2025, the stockholders voted to approve the exercise of the December Offering warrants (see Note 15 – Subsequent Events - Stockholder Approval of Warrants).

Warrants

The issuance date or modification date fair value of stock warrants issued or modified during the years ended December 31, 2024 and 2023 was determined using the Black Scholes method, with the following assumptions used:

A summary of the warrant activity during the year ended December 31, 2024 is presented below:

The following table presents information related to warrants as of December 31, 2024:

During the year ended December 31, 2024, Pre-Funded Warrants for the purchase of 152,905 shares of the Company’s common stock with an exercise price of $0.008 per share were exercised for aggregate proceeds of $1,223.

During the year ended December 31, 2023, warrants for the purchase of 28,162 shares of the Company’s common stock with an exercise price of $0.80 per share were exercised for aggregate proceeds of $22,529.

Stock-Based Compensation Expense

The Company records stock-based compensation expense related to stock options and restricted stock units, or RSUs. For the years ended December 31, 2024 and 2023, the Company recorded stock-based compensation expense of $1,704,273 ($623,049 of which was included within research and development expenses and $1,081,224 was included within selling, general and administrative expenses on the statements of operations) and $2,497,890 ($839,038 of which was included within research and development expenses and $1,658,852 was included within selling, general and administrative expenses on the statements of operations), respectively.

Restricted Stock Units

A summary of the restricted stock units activity during the year ended December 31, 2024 is presented below:

To date, the RSUs have only been granted to directors in accordance with the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan. The Company’s policy is not to deliver shares underlying the RSUs until the termination of service.

On June 12, 2024, the Company granted members of its Board of Directors an aggregate of 4,608 RSUs under the Restated Plan. Each RSU is subject to settlement into one share of the Company’s common stock. The RSUs vest on the earlier of (i) the one-year anniversary of the date of grant and (ii) the date of the 2025 annual stockholders meeting, subject to the grantee remaining on the Board until then. The RSUs had a grant date fair value of $239,772, which will be recognized over the vesting period. In 2024, there wereno shares of common stock issued related to vested RSUs.

Between June 27, 2023 and November 14, 2023, the Company granted members of its Board of Directors an aggregate of 1,322 RSUs under the Restated Plan. Each RSU is subject to settlement into one share of the Company’s common stock. The RSUs vest on the earlier of (i) the one-year anniversary of the date of grant and (ii) the date of the 2024 annual stockholders meeting, subject to the grantee remaining on the Board until then. The RSUs had a grant date fair value of $224,800, which will be recognized over the vesting period. In 2023, there were 597 of common shares issued related to vested RSUs.

As of December 31, 2024, there was $109,897 of unrecognized stock-based compensation expense related to RSUs which will be recognized over a weighted average period of 0.45 years.

Stock Options

A summary of the option activity during the year ended December 31, 2024 is presented below:

The following table presents information related to stock options as of December 31, 2024:

In applying the Black-Scholes option pricing model to stock options granted, the Company used the following approximate assumptions:

The Company has computed the fair value of stock options granted using the Black-Scholes option pricing model. Option forfeitures are accounted for at the time of occurrence. The expected term used for options issued is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” option grants. The Company uses its historical volatility for the period from its initial public offering through the valuation date in computing the expected volatility. Accordingly, the Company is utilizing an expected volatility figure based on a review of its historical volatility over a period of time equivalent to the expected life of the instrument being valued. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of

the instrument being valued. The Company has not declared dividends, is currently in the development stage and has no plan to declare future dividends at this time.

The weighted average estimated grant date fair value of the stock options granted for the years ended December 31, 2024 and 2023 was approximately $63 and $132 per share, respectively.

As of December 31, 2024, there was $949,697 of unrecognized stock-based compensation expense related to stock options which will be recognized over a weighted average period of 1.3 years.

Note 13 – Employee Benefit Plans

401(k) Plan

In April 2019, the Company adopted the Eyenovia 401(k) Plan, or the Plan, which went into effect in May 2019. All Company employees are able to participate in the Plan, subject to eligibility requirements as outlined in the Plan documents. Under the terms of the Plan, eligible employees are able to defer a percentage of their pay every pay period up to annual limitations set by Congress and the Internal Revenue Service under Section 401(k) of the Internal Revenue Code. The Company’s Board of Directors approved a matching contribution equal to 100% of elective deferrals up to 4% of eligible earnings with the matching contribution subject to certain vesting requirements as outlined in the Plan documents. For the years ended December 31, 2024 and 2023, the Company recorded expense of $264,104 and $218,170 associated with its matching contributions, respectively.

Note 14 – Segment Reporting

The Company hasone operating and reporting segment (ophthalmic technology), namely, the development and commercialization of ophthalmic solutions. The accounting policies of the segment are the same as those described in the summary of significant accounting policies. The chief operating decision maker (“CODM”), who is the Company’s chief executive officer, utilizes the Company’s financial information on an aggregate basis for purposes of making operating decisions, allocating resources and assessing financial performance, as well as for making strategic operations decisions and managing the organization. The measure of segment assets is reported on the balance sheet as total assets.

The Company’s significant expenses reviewed by the CODM for the years ended December 31, 2024 and 2023 are as follows:

Note 15 – Subsequent Events

January 2025 Offering

On January 16, 2025, the Company entered into an Inducement Offer (the “Inducement Offer”) with an Investor (the “Investor”), by which the Company agreed to reduce the exercise price of 197,118 existing warrants (“the Existing Warrants”) from $55.20 per share, to $5.272 per share. The Inducement Offer had a limited exercise period, until January 17, 2025, to exercise the Existing Warrants (the “Exercise Period”).

In connection with the Inducement Offer, if the Investor exercised the Existing Warrants within the Exercise Period, the Company agreed to issue 197,118 Series A Common Stock Purchase Warrants and 197,118 Series B Common Stock Purchase Warrants to purchase an additional 394,236 shares of common stock at an exercise price of$5.272 per share which may be exercised forfive years from the initial exercise date. The warrants become exercisable upon stockholder approval.

On January 17, 2025, the Investor exercised the Existing Warrants within the Exercise Period. The aggregate gross cash proceeds to the Company from the inducement offer were approximately $1.0 million, and net cash proceeds after offering costs were approximately $0.9 million.

Stockholder Approval of 2024 Warrants

On January 21, 2025, in connection with the December Offering, the stockholders approved the exercise of the September Offering warrants, the November Offering warrants and the December Offering warrants (see Note 12 – Stockholders’ Equity - Offerings).

Reverse Stock Split

On January 31, 2025, the Company effected the Reverse Split of its common stock at a ratio of 1-for-80. Upon the effectiveness of the Reverse Split, every 80 issued shares of common stock were reclassified and combined into one share of common stock. In addition, the number of shares of common stock issuable upon the exercise of the Company’s equity awards, convertible securities and warrants was proportionally decreased, and the corresponding conversion price or exercise price was proportionally increased. No fractional shares were issued as a result of the Reverse Split, stockholders who would otherwise be entitled to receive a fractional share will be entitled to receive a cash payment in lieu of such fractional share. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the Reverse Split and adjustment of the conversion price or exercise price of each outstanding equity award, convertible security and warrant as if the transaction had occurred as of the beginning of the earliest period presented.

Avenue Ventures Loan Second Amendment

On February 21, 2025, the Company entered into a second amendment of the Avenue Loan Agreement (the “Second Amendment”) whereby the Lender agreed to defer principal and interest payments on amounts outstanding until the end of September 2025. Deferred interest will accrue on the outstanding principal amount at the interest rate stated in the original Avenue Loan.

Under the Second Amendment, the Company has agreed to use a portion of the proceeds (net of fees and commissions payable to Chardan) received from sales under the A&R Sales Agreement (the “A&R Proceeds”) to pay down the outstanding principal amount under the Avenue Loan Agreement as follows: a) until the Company raises $3.0 million of aggregate A&R Proceeds,65% of the A&R Proceeds shall be remitted to the Lenders as a payment in respect of the outstanding principal amount, and b) after the Company raises $3.0 million of aggregate A&R Proceeds,75% of the A&R Proceeds shall be remitted to the Lenders as a payment in respect of the outstanding principal amount.

Pursuant to the Second Amendment, at any time on or after April 1, 2025, the Lenders will also have the right, in their discretion, but not the obligation, to convert an aggregate amount of up to $10.0 million of the aggregate principal amount under the Avenue Loan Agreement into shares of the Company’s common stock, at a price equal to $1.68 per share.

Increase and Issuance of 2018 Omnibus Stock Incentive Plan Shares

On January 21, 2025, the stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan to reserve an additional 350,000 shares of the Company’s common stock for issuance thereunder, which number will not be adjusted as a result of the Reverse Split.

On February 5, 2025, the Company granted 240,000 shares of restricted stock units in the aggregate to consultants and employees. The shares vest on the earliest of (i)one year from the date of issuance, (ii) a change in control of the Company, and (iii) with respect to employees, the date on which their employment with the Company is terminated, other than by such employee’s voluntary resignation.

At-The-Market Program

Subsequent to December 31, 2024, the Company received approximately $5.9 million in gross proceeds from the sale of 1,127,100 shares of its common stock pursuant to its Sales Agreement with Chardan in its “at-the-market” offering. In connection with the Second Amendment mentioned above, the Company paid Avenue $777,369 in gross proceeds received from the at-the-market offering, which was equivalent to 65% of the proceeds raised from February 21, 2025 to March 31, 2025.